Depending on investment plans, you can apply to invest through the Foreign Investment Review Board (FIRB). The board considers wide-ranging factors, including investment ownership, visa status and country of residence. As a non-resident, your ability to invest in the property market depends on specific regulations. These rules determine the type of housing you can buy.
Australia’s FDI policies facilitate the creation of jobs in the construction industry by ensuring that foreign investors purchase new properties. Hence, you can invest in new buildings and vacant land. The FIRB approves applications to buy existing buildings on the condition that you plan to demolish the structure and replace it with an increased number of buildings.
For instance, if you purchase a single-family home, you need to replace it with two or more structures (townhouses, multi-family homes or other types of properties). In the end, the investment should augment the local housing supply.
You can expect the review board to approve your application to invest in a new building without stringent conditions. On the other hand, FIRB approves applications to purchase vacant land if you intend to complete construction within four years. When it comes to purchasing a home for personal use, the board approves your application if you hold a temporary residence permit. Authorities expect you to sell the property upon departure from the country.
To pick the right option, consider the location of the property. A well-chosen property in a lucrative area is beneficial in terms of increased demand and capital growth. Properties located close to the beach or the central business district can be appealing to the target market. This approach also applies to properties close to key amenities like shopping centers, public transport hubs, schools, and restaurants.
How Does the FIRB Application Process Work?
Once you’re ready to apply, fill out online forms via the Australian Taxation Office’s (ATO) website. The platform provides access to the “foreign investment in Australia” page. You must have your passport and visa ready before filling out the application. The process also involves providing details of the property you plan to buy. To benefit from the application fee waiver, submit your form with a waiver request.
You must request approval from the FIRB before acquiring the right to purchase the property. The latter means you’ve agreed with the seller to buy the property at a later date. Alternatively, you can sign a conditional contract with the seller before applying for approval with the FIRB. This option allows you to exit the contract if another buyer purchases the property while you wait for approval.
Whether you plan to buy vacant land or a new building, avoid acquiring property without FIRB approval. Failure to seek approval can result in hefty fines or imprisonment (three years minimum). The authorities can also impose fines if you fail to sell the property after the expiry of your temporary residence visa and subsequent departure.